
[Federal Register: August 26, 2009 (Volume 74, Number 164)]
[Notices]               
[Page 43184]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26au09-125]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60546; File No. SR-NASDAQ-2009-058]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Order 
Approving Proposed Rule Change To Modify Port Fees

August 20, 2009.

    On June 24, 2009, The NASDAQ Stock Market LLC (``NASDAQ'') filed 
with the Securities and Exchange Commission (``Commission''), pursuant 
to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') 
\1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to modify fees 
charged to members and non-members for ports used to enter orders into 
NASDAQ systems. The proposed rule change was published for comment in 
the Federal Register on July 16, 2009.\3\ The Commission received no 
comments regarding the proposal.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 60265 (July 8, 2009), 74 
FR 34613 (``Notice'').
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    NASDAQ proposes to increase the monthly fee that it charges for 
ports used to enter orders in NASDAQ trading systems such as the NASDAQ 
Market Center and the NASDAQ Options Market. The change, which would 
increase the charge from $400 to $500 per month, would apply to ports 
using FIX, RASH, and OUCH and would not affect ports used to receive 
market data, to enter quotes, or to enter trade reports into the FINRA/
NASDAQ Trade Reporting Facility. The change would apply to both members 
that obtain ports for direct access and non-member service bureaus that 
act as a conduit for orders entered by NASDAQ members that are their 
customers.
    NASDAQ also proposes to modify the language of Rule 7015 to make it 
clear that access service fees apply to access provided to all NASDAQ-
operated systems, to replace references to NASD with references to 
FINRA, and remove obsolete language regarding a trial discount that 
ended in 2007. In addition, NASDAQ proposes to remove language 
regarding the applicability of the rule to members and non-members. 
NASDAQ believes that such language is unnecessary and potentially 
confusing to the reader.
    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange \4\ and, in 
particular, the requirements of Section 6(b) of the Act \5\ and the 
rules and regulations thereunder. Specifically, the Commission finds 
that the proposal to increase the fee that it charges for ports used to 
enter orders in NASDAQ trading systems is consistent with Section 
6(b)(4) of the Act,\6\ which requires the equitable allocation of 
reasonable dues, fees, and other charges among NASDAQ members and other 
persons using NASDAQ's facilities.\7\ The Commission believes that the 
proposed increase in port fees is equitably allocated among members and 
non-members, as it is based on the number of access ports that they use 
to submit orders to the market. The Commission also believes that, if 
NASDAQ's proposed port fees are set too high, given the competitive 
nature of the market for execution and routing services, market 
participants could simply opt to connect with market centers other than 
NASDAQ to access liquidity available on NASDAQ by directing order flow 
to the other market centers that are required to route to NASDAQ if it 
has posted the best available price. As such, the Commission believes 
that NASDAQ's proposed increase in port fees is both equitably 
allocated and reasonable.
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    \4\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. See 15 U.S.C. 78c(f).
    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
    \7\ The Commission notes that NASDAQ will implement the 
increased port fees September 1, 2009. See Notice, supra note 3.
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    In addition, the Commission believes that the clarifying changes to 
Rule 7015 are consistent with the requirements of Section 6(b)(5) of 
the Act,\8\ which requires, among other things, that NASDAQ's rules be 
designed to promote just and equitable principles of trade, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, and, in general, to protect investors and the 
public interest. The Commission believes that updating and removing 
certain outdated or unnecessary references in Rule 7015 would provide 
additional clarity to the rule text, for the benefit of market 
participants accessing NASDAQ's facilities and the marketplace as a 
whole.
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    \8\ 17 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (SR-NASDAQ-2009-058) be, and it 
hereby is, approved.
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    \9\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-20594 Filed 8-25-09; 8:45 am]

BILLING CODE 8010-01-P
